The gambling clause forced the mainnet to go online, and the first batch of Filecoin mining machine manufacturers cashed out and left

There is not much time left for Filecoin.

In the first half of 2020, Filecoin's popularity in China remained high and continued to rise. Some time ago, the launch time of the popular "Filecoin" mainnet was postponed again. The latest mainnet launch window was set from August 31 to September 21, which once again became the focus of many institutions.

What roles do the Filecoin team, miners, mining pools, exchanges, media, and participants from all sides play?

For the Filecoin team itself, the time to “hand in the paper” is approaching.

Filecoin is in a hurry

In the community, Filecoin is often described as having its own halo. When it was first released in 2017, a large part of the source of this "traffic" came from well-known investment institutions.

From July to September 2017, Filecoin raised funds through ICO, including private and public offerings. Before the public offering, it had raised $52 million through private offerings, with a private offering cost of about $0.75/FIL. In August of the same year, Filecoin issued tokens on the financing platform Coinlist in compliance with the SAFT agreement, and eventually raised another $205 million. The public offering cost was between $1 and $5, and the cost price of the last round of investment was $5, with an average public offering cost of about $3.

Private and public offerings raised a total of US$257 million, setting a record for project financing in the industry at the time. Filecoin was in its heyday.

Looking back at this fundraising event, 2020 became an important time node.

Coinlist is a financing platform that provides token issuance (ICO) for qualified investors and high-quality blockchain projects. It is committed to the compliance of token issuance and requires that the projects issued on its platform must comply with the US securities law framework. In August 2018, participation in Filecoin's early financing through Coinlist was completed through the SAFT agreement (Simple Agreement for Future Tokens), which is an investment contract provided by cryptocurrency developers to qualified investors, which includes the purchase price, vesting period and other relevant legal factors. Under this framework, the SAFT contract will be sent to investors during the fundraising period to guarantee the delivery of tokens after a certain time.

“SAFT is for qualified investors, has a delivery deadline, and a refund will be made if delivery cannot be made,” explained a Filecoin enthusiast from the community.

Blocklike also learned from industry veterans that during the private placement stage, the investment agreement signed between Filecoin and a first-tier international investment institution involved a bet. In the terms of the bet, 2020 became the promised deadline for Filecoin officials to fulfill the mainnet launch, project promotion and advancement.

Although it has been postponed again and again, Filecoin may be more anxious about the mainnet launch. But paradoxically, Filecoin still needs time to adjust.

During the second test of Filecoin in mid-May, it was soon revealed that the test network had a bug, followed by some feedback from the community. Within a few hours of the test, the official browser filscan.io was attacked by DDOS again. After emergency repairs and upgrades, it crashed again due to the attack.

The fact that the mainnet has not been launched for nearly three years also proves to some extent that Filecoin still has great technical difficulties. In the community, some investors have a conservative attitude towards Filecoin after carefully studying the Filecoin code and development. According to the views of these investors, in addition to the frequently mentioned BUGs, code audits, and security issues, the Filecoin network itself is also unstable, and the functions that can be truly realized are discounted. In terms of some technical issues, it is still at the "research level of mathematical problems."

"From what I understand, Juan's team responsible for Filecoin technology development may only have 8 people, which is not optimistic," Leng Yue, a veteran in the industry, told Blocklike.

Mining industry faces mixed results

In China, the launch of Filecoin’s testnet in December 2019 became the dividing line for a change in Filecoin’s hype logic.

Before that, in 2018, many stacked hard drive mining machines were marketed under the name of "filecoin". This kind of marketing concept deceived some investors and brought adverse effects to the reputation of IPFS. After the code was open sourced, Filecoin officials still repeatedly emphasized: the code base and development network are mainly used for development and research testing, and reminded miners not to invest heavily in mining hardware based on current specifications and standards, and many parameters are still variables.

Therefore, many mining machines produced earlier have great uncertainty on the most basic question of "whether they can mine coins". However, since the launch of the Filecoin test network, many domestic technical teams have been able to deconstruct and judge the Filecoin project, thereby producing relatively reliable mining machines. At present, the standard for judging the performance of mining machines is the test data on the development test network.

It is worth noting that since the investment logic of distributed storage is clear and the concept is easy to understand, it is easy for both traditional investors and people in the industry to understand. In addition, Filecoin also balances the interests of all parties in the ecosystem to a certain extent, allowing exchanges, media, capital, original Bitcoin mining pools and traditional capital to pour in. In the first half of the year, Filecoin has attracted a lot of off-site funds to enter the market. This makes Filecoin's star halo more obvious in the first half of the year when there were few industry hot spots.

As Panda Miner COO Yang Xiao said publicly to the media: "After the BTC halving, there are no hot projects that can attract attention in the entire market, so the entire market has been in a long-term downturn. At this time, Filecoin, a project with a huge market value, certain applications, and the participation of the mining and currency circles, must have a huge star effect. Everyone needs a "savior" with a halo. In addition to the crazy selling expectations of FIL mining machine manufacturers, exchanges also need to use this potential to attract more traffic."

Some people are optimistic about the technical direction, some come here because of its reputation, and some people choose to join in out of helplessness.

An employee from a BTC mining machine provider who did not want to be named told Blocklike: “Many BTC mining machines and mining pools, although not publicly announced, are switching to Filecoin mining machines. There is no choice. The original business has cash flow problems, but the business cannot be stopped. Personnel, operating and other costs are continuing. Filecoin is one of the few options, and we must join in.”

Investors have mixed reactions

What stage are the various institutions upstream and downstream of Filecoin in now?

“There are people selling Filecoin mining machines all over the world. Where were they when we were talking about IPFS and Fil everywhere in early 2018? Working on IPFS now is just filling a hole,” said Gu Qianfeng, an early participant in the IPFS field.

In his opinion, those who enter the market at this time are filling the "pit" dug by the previous ones. At present, several large mining farms are planning to set up in Africa, because there are more miners than miners in Africa. According to the official reward plan, there are very few miners in Asia, especially in China, and Chinese miners account for more than 90% of the world's miners. —— Mining is not unprofitable, but all mining mechanisms are the relationship between numerators and denominators. The more people participate, the larger the denominator, and the less each person gets, especially for popular projects such as Fil.

In addition, he also saw other risk points from the hard drives launched by Filecoin some time ago. In early May, Filecoin officially launched the Filecoin Discover project to sell 8T hard drives. These hard drives contain data sets of five types to choose from, including literature, artificial intelligence, meteorology, and history.

"Take the official sale of weather data hard drives as an example. Two days ago, Shenzhen Customs seized a large number of illegally imported hard drives containing data and arrested several people. Although it is impossible to determine whether this batch of keyboards is related to Fil's official hard drives, this shows that the official hard drives approved for mining cannot enter mainland China. In addition, the biggest risk facing Fil is content censorship, which is why the official launched hard drives containing global weather data and sold them to global miners for mining. Because weather data does not involve political risks, but this behavior itself is very funny. It has completely deviated from Fil's original intention."

“But there is nothing that Boss Hu (referring to Juan Benet, founder of the Filecoin project) can do. After all, he is in the United States, and his life is much more important than the lives of Chinese miners.”

Perhaps it is just as blockchain industry analyst Kui Dong summarized: some of the first batch of profitable mining machines or computing power service providers around Filecoin are already cashing out and leaving the market. For some early players, since they have huge advantages in investment positions, they can continue to make money from information/time asymmetry in the market at no cost after cashing out their principal. The institutions and media that entered the market later have their own halo and communication effect, so they are also squeezing the B-side funds as much as possible. Regardless of whether the Filecoin mainnet can be successfully launched in the end, as long as the story continues, the market will remain active.